Success Story of the week: Smart Choices Pay Off

Just how do you overcome $100,000 in debt, 2 kids to put through college, and despite being a husband with a great salary – you’re a professional in the “red zone” of retirement living paycheck to paycheck?

Victor was referred to me 15 years ago by his parents. He had then bought a nice condo in the South Bay and planned on paying it off. Through the years he got loans with other companies, repeatedly taking out more and more debt and higher and higher payments.

Now, as he was approaching retirement, he was facing some tough choices: Do you take your kids out of club sports, drop the tutor that is helping them get ahead in lessons, downsize the house, have your wife go back to work part time (she still has to be there for the kids or pay for help … just what do you do and what is the “right” choice?

It was at that time I randomly started thinking about my former client and emailed him in October. It took him until January to get back to me (yes I admit I forgot about it after I sent the email) and he told me he wanted to do a refi so he could pay off his debt.

When he told me how much he owed, I told him that this is critical that we take care of it so he can have a chance to retire. Though his credit score was being pulled down by the debt, the value of his condo that he had bought for $200,000 in 2000 was now worth $850,000!

Yeah! One smart move years ago instantly solved his problems. In hindsight he looked brilliant. Now to get rid of the debt, we were able to pay off the current mortgage, wrap the $100k in debt into the loan, and save him $2200 per month! I also caught that through one of the refinances with the other companies they mistakenly put his wife’s name on title with no vesting which means that if something happened to them, the condo would have gone through probate.

We fixed it all and I also invited him to do a financial plan so he could see what shape they were in to retire. A friend of mine and fellow financial advisor once said “you can borrow for school but you can’t borrow for retirement”.

Now that he is in the clear with the past, we will now start the conversation on how to protect their future and still help their kids. He can now breathe easy and make a plan for his future.

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Athena Paquette, M.A.

Real Estate Broker
CA Bureau of Real Estate # 01142629
NMLS # 321683

Disclaimer

Athena Paquette offers educational information so you can make an informed investment decision. We do not endorse any particular investment, and we do not provide tax, legal, accounting, investment, or other professional advice. Please know that investing in any asset involves risk and you should therefore consult tax, legal and financial experts before investing as individual results may vary.